Hedge Fund Manager Walks Away over Pricing
Imbroglio

Anthony Barkan, who oversaw The Clinton Group’s
asset-backed securities team, said in a statement that he
disagreed with others at the company about how certain
bonds were priced, that he reported the disagreement to
the fund’s officers and that the dispute “forced” him to
resign, Reuters reported.

“The decision was particularly difficult for me
especially given the excellent performance of the ABS
group this year,” Barkan told Reuters, referring to his
asset-backed securities group. “I had to stand by my
principles.”

The $5-billion hedge fund said in a news release
that it was “surprised” at Barkan’s departure, but that
it would take the complaints seriously. The firm said it
had hired accountants PricewaterhouseCoopers to review
the issue.

Barkan’s departure was on the same day that
authorities brought charges against another hedge fund
manager for overstating investment returns. The US
Attorney’s Office and the US Securities and Exchange
Commission accused Edward Strafaci, a former manager at
hedge fund Lipper & Co., of overvaluing investments.
Edward Strafaci, who left Lipper in early 2002, faces
four criminal charges, which together carry a maximum
penalty of 30 years.

Clinton Group, which has $5.3 billion in hedge fund
assets, is the world’s number 14 hedge fund, according to
a poll by Institutional Investor magazine.